The volume of direct benefit transfers (DBT) surged by a solid 37% to Rs 3.9 lakh crore in the first seven months of 2021, compared to the same period last year. The DBT scheme implemented via 351 schemes of more than 51 ministries, transfers central subsidies and other cash payments to the accounts of beneficiaries under the world’s largest financial inclusion drive. Prior to Mr Narendra Modi taking charge as PM, India’s banking penetration was less than 50%, which today stands at almost 100%, thanks to the Pradhan Mantri Jan Dhan Yojana (PMJDY), launched on a war footing.
Today, more than 43 crore Jan Dhan accounts have ensured that via DBT, the poor and the underprivileged get access to what is rightfully theirs with respect to government subsidies and benefits, without any pilferage. The DBT cash transfers include pensions, fertiliser subsidies, the now discontinued LPG subsidy, Covid-related cash help from the Centre and a host of other schemes under the Centre and state administrations. The system of sending money directly to beneficiaries through Jan Dhan account, Aadhaar and mobile (JAM trinity) made it easier to identify bogus beneficiaries and prevent leakages in government schemes. JAM has saved more than Rs 1.78 lakh crore on average, from falling into the hands of middlemen, every single year.
DBT, which has in the last seven years, transferred over Rs 17.5 lakh crore to beneficiaries, under the aegis of the Modi government, has been empowering in every sense of the word. Clearly, India’s digitisation is progressing rapidly, creating new benchmarks. For instance, in July 2021, the unified payments interface (UPI) platform processed 324 crore transactions, in terms of volume of transactions and a whopping Rs 6.06 lakh crore in terms of the transaction value. This is a sharp jump since June 2021, when UPI had processed 280 crore transactions worth Rs 5.47 lakh crore. On a daily basis, UPI has been processing between 9 to 11 crore transactions recently.
Launched in 2016, UPI processed 100 crore transactions for the first time, only as recently as October 2019 and has never looked back, since. While lockdowns due to the Covid-19 pandemic impacted digital payments and transactions, UPI has been gaining popularity due to its wide acceptance and ease of use. Other digital payment modes have also been gaining traction. Immediate payments service (IMPS) clocked 34.97 crore transactions amounting to Rs 3.09 lakh crore in July this year.
Aadhaar-enabled payment system (AePS) transactions also rose to 8.88 crore in terms of volume and Rs 23,447.11 crore in value terms in July. It had processed 8.75 crore transactions amounting to Rs 24,667.08 crore in June 2021.
As many as 19.23 crore transactions worth Rs 2976.39 crore were processed on NETC FASTag in July 2021, as compared to 15.78 crore transactions totalling Rs 2,576.28 crore in June 2021.Reflecting the rapid adoption and deepening of digital payments across the country in recent years, the “Reserve Bank of India- Digital Payments Index” for March 2021 rose to 270.59, as against 207.84 for March 2020. With digital transformation under the visionary leadership of PM Modi, making life much easier for various stakeholders concerned, it was only a natural progression of things to have an online digital currency. And that is precisely what happened on August 2, 2021, with the launch of India’s very own digital currency called the eRUPI.
The eRUPI initiative launched by PM Modi is one of the most game-changing and revolutionary moves in recent times, for more reasons than one. The e-RUPI programme intends to limit the point of contact between the government and beneficiaries and will ensure that benefits reach the intended beneficiaries in a targeted and leak-proof manner. ERUPI is a non-cash and contactless tool for digital payments. It acts as a voucher, based on a QR code or SMS chain and is sent to the beneficiary’s mobile phone.
Mudra Bank eRUPI digitally connects service initiators with beneficiaries and service providers, without any physical interface. It also ensures that payment is made to the service provider only after the transaction is completed. It is prepaid in nature, which guarantees timely payment to the service provider without the involvement of any intermediary. ERUPI’s single payment mechanism will allow users to redeem coupons at service providers without a card, digital payment application, or access to online banking. The eRUPI platform was developed by the National Payments Corporation of India (NPCI) on its UPI platform in cooperation with the Ministry of Financial Services, the Ministry of Health and Family Welfare and the National Health Service.
The path-breaking eRUPI is expected to be a revolutionary measure to ensure that welfare services are leak-free. It can also be used to provide services under the Maternal and Child Benefit Plan, the Tuberculosis Eradication Plan, the Support Plan for medicine and nutrition under the Medication and Diagnosis Plan, schemes such as Ayushman Bharat, transfer of fertilizer subsidies and other welfare-oriented programs. NPCI will launch an eRUPI website soon. ERUPI will be the first Indian digital currency and only NPCI will be authorized to control, circulate and design the framework of India’s very own digital online currency, the eRUPI.
The use of technology to deliver cooking gas subsidies, ration money and other social security schemes directly to bank accounts of beneficiaries are the best example of last-mile delivery. Launching an e-voucher that government and private entities can use to reach specific benefits like vaccination to the needy, the eRUPI mechanism will further promote a leakage-free targeted delivery system, to make sure that appropriate relief reaches the needy. eRUPI voucher is another technological advancement that will introduce transparency and ensure that donations by private individuals are used for the intended purposes.
“We must ensure that technology is accessible, affordable and adds value” is a powerful quote by PM Modi and sums up the essence of what eRUPI, India’s very own digital currency, entails going forward.
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